Strengthening Navy Financial Accountability through Property Plant &Equipment (PP&E) Reform

Abstract

This thesis examines how deficiencies in Plant, Property and Equipment (PP&E) accounting and acquisition practices affect the Department of War, specifically the Department of the Navy’s (DON) ability to achieve a clean financial audit and proposes reforms to improve audit readiness and accountability. This study adopts both quantitative and qualitative case study approaches, combining document analysis, policy review, and semi-structured interviews with experts. Using internal DON data and audit findings from FY2018–FY2024, we assess systemic deficiencies affecting weaknesses, controls, and financial processes. Our analysis evaluates workforce structure, system interoperability, and process compliance on audit outcomes. Findings show audit discrepancies mainly stem from (i) poor documentation controls, (ii) inconsistent business process application, (iii) system gaps between Navy ERP and feeder systems, and (iv) high personnel turnover. Quantitatively, process and documentation errors account for about 62% of repeat findings, with system issues accounting for 28%. Results suggest that the Navy needs targeted workforce development, system modernization, and stronger internal controls aligned with DoW FIAR priorities. A shift to standardized processes, better training, and improved data governance can reduce deficiencies and boost audit reliability.